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2018 Legislative Session Preview

Posted By Administration, Tuesday, December 19, 2017

Judging from the action packed off-season, the 2018 Legislative Session will have no shortage of storylines. With legislative lawsuits, accusations of sexual harassment, a wide-open gubernatorial race and both US Senate seats on the ballot, not to mention the actual policy issues at play in 2018, it promises to be a very busy close to the 90th Legislature. This preview aims to make sense of what has happened since the Legislature adjourned in May and what it will mean for 2018.

Legislative Funding Saga

Governor Dayton and legislative leaders spent the off season locked in a protracted legal battle stemming from the Governor’s line-item veto of roughly $130 million in funding for the House and Senate. The Governor vetoed the funding with the goal of forcing legislative leaders to call a special session to renegotiate provisions in the tax bill. Legislators opted instead to take Governor Dayton to court over what they claimed to be an unconstitutional abolishment of a co-equal branch of government. Legislators won the initial court decision, with the Governor’s veto ruled null and void and full legislative funding restored. But Governor Dayton appealed the ruling to the Minnesota Supreme Court, which chose not reverse the lower court ruling, but deemed the veto constitutional and ordered mediation between the two sides.

Mediation lasted a day and a half and was ultimately successful only in upsetting the parties further. Governor Dayton left claiming he had been lied to by the Legislature with respect to how long they could operate without additional funding. Legislative leaders were frustrated that they were renegotiating things that had already been negotiated during Session. The case then went back to the Minnesota Supreme Court, who upheld the constitutionality of the veto.

The Legislature acted quickly after the ruling to transfer $26 million in reserves from the Legislative Coordinating Commission to maintain operations ahead of the 2018 Legislative Session.  Considering the rhetoric and divisive nature of the legal matter, the funding issue is likely to roll over into the 2018 Legislative Session and keep tension between Democrats and Republicans extremely high.  

Sexual Harassment Policies

Sparked in part by the national conversation taking place around sexual harassment in the workplace, the Minnesota Legislature has had several high profile incidents of sexual harassment come to light in recent weeks. DFL Senator Dan Schoen and Republican Representative Tony Cornish were both accused of inappropriate sexual behavior. Both initially attempted to fight the allegations, but eventually agreed to resign their positions in the Legislature.

A request for a state task force to address “the culture of our legislative bodies and campaigns” has been called for by lawmakers who have experienced sexual harassment. The issue of sexual harassment is undoubtedly larger than just the two lawmakers accused of inappropriate behavior to date. Expect it to be a dominate story line all Session. With both a Democrat and a Republican accused of inappropriate behavior so far, this issue offers a chance for the parties to work together without partisanship derailing the effort to address a serious issue. A bipartisan effort to update sexual harassment policies at the State Capitol has been launched and will likely be a central issue in 2018.

State politics have also been impacted by the resignation of Senator Al Franken for sexual misconduct predating his time in the US Senate. Lieutenant Governor Tina Smith has been selected to serve out the final year of Senator Franken’s term, which has created additional drama at the state level. According to the Minnesota Constitution, State Senator and current Senate President Michelle Fischbach will replace Tina Smith as Lieutenant Governor and serve with DFL Governor Mark Dayton. Senator Fischbach and Senate Republicans are confident she can serve in both roles simultaneously, while Governor Dayton and DFL leaders are claiming she must resign her Senate Seat. It remains to be seen if this is an issue that can be worked out by party leaders or if we will be seeing yet another high profile court case in advance of the 2018 Legislative Session.

Bonding Bill  

The second year of the biennium is traditionally the year in which a bonding bill is assembled. In order to be eligible for this form of state funding, a project must be publically owned, be of state or regional significance, and be a capital project. To fund these projects, the state sells general obligation bonds on the bond market and pays the debt service on these bonds over time.  Normally the House and Senate Capital Investment Committees go on extensive tours of the state to see projects vying for state funding. They are able to tour facilities and ask questions of stakeholders to better understand the projects applying for state support.  However, as a result of the ongoing funding issue discussed above, the Senate Capital Investment Committee cancelled their bonding tour in an effort to save resources. The House Capital Investment Committee went ahead with their tour as scheduled.

There will be no shortage of requests for capital projects from across the state. It will be up to the Capital Investment Committees in each body to sort through the requests and assemble a bill that can get a 60 percent majority to pass, a process that will be highly anticipated and scrutinized by stakeholders across the state.

Supplemental Budget

While Minnesota’s two-year budget was set during the 2017 Legislative Session, there is an outside chance there will be a supplemental budget bill in 2018. A supplemental budget bill’s chances will be closely tied to the State’s economic forecast, which will be updated in February. The November economic forecast projected a deficit totaling $188 million, although the majority of this can be attributed to the lack of Children’s Health Insurance Program (CHIP) funding from the Federal government. In the event that a CHIP funding solution is worked out in Congress, the February forecast may be rosier than the November report was. We will be closely following these developments and will adjust our expectations and approach accordingly. 

Gubernatorial and US Senate Races

Politics usually plays a starring role at the Legislature, but with the 2018 gubernatorial race already fully underway, that will be especially true of the 2018 Legislative Session. Neither the Democrats nor the Republicans have a clear front-runner for their party nomination yet, and as such we are likely to see candidates jockeying for position during Session. Currently there are several sitting Legislators from both the House and Senate who have officially entered the Governor’s race.  With Senator Franken’s seat now thrown into play in 2018, along with Senator Klobuchar’s seat, there will be no shortage of statewide races, meaning both parties will have plenty of current office holders angling for a promotion. How this may impact the 20108 Legislative Session remains to be seen, but you can certain it will!

Please reach out with any questions to Sam Richie or Kevin Walli at Fryberger, Buchanan, Smith & Frederick, P.A., who can be reached at (651) 221-1044.

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